" OWP No. 755/2013 Page 1 of 6 HIGH COURT OF JAMMU AND KASHMIR AT JAMMU OWP No. 1727/2016, MP No. 1/2016 c/w OWP No. 755/2013, MP No. 1042/2013 Date of order: 27.02.2019 M/s J&K Aluminum Company & ors. vs State of J&K & ors. Coram: Hon’ble Mr. Justice Dhiraj Singh Thakur, Judge OWP No. 1727/2016 Mr Anil Sethi, Advocate with Mr. I.S. Ratta, Advocate for the petitioners. Mr. Vishal Sharma, ASGI for R-1 Mr. F.A. Natnoo, AAG for R-2. Mrs. Monika Kohli, Adv. for R-3. OWP No. 755/2013 Mr Anil Sethi, Advocate with Mr. I.S. Ratta, Advocate for the petitioners. Mr. F.A. Natnoo, AAG for R-1. Mr. Vishal Sharma, ASGI for R-2, 3, 6 & 7. Mrs. Monika Kohli, Adv. for R-3. i. Whether approved for reporting in Press/Media : Yes/No ii. Whether to be reported in Digest/Journal : Yes/No OWP No. 755/2013 1. Petitioner No. 1-Unit is stated to have been established in the year 2006-2007 in the industrial estate at Samba. 2. The case set up in the petition is that the petitioners’-Unit was established on the assurances and incentives granted by the Govt. in regard to exemptions from payment of excise duty, sales tax, capital investment, income tax holiday for the first five years of operation of the unit, diesel generator set subsidy as also transportation subsidy etc. OWP No. 755/2013 Page 2 of 6 3. It is further stated that for establishing the Unit, a huge amount of loan was raised from the State Bank of India amounting to Rs. 27 crores besides investments from other sources. 4. It was urged that initially the income of the Unit was good. However, the Unit became unviable on account of the following: (i) That in the year 2008, the entire state of J&K got disturbed on account of Shri Amarnath Ji’s agitation, which affected the manufacturing as also the transportation of the products from the Unit and finally, this led to stoppage of work from July, 2008 to August, 2008. (ii) That the State Govt. backed out of its promise and failed to provide power connection as also various subsidies and exemptions which were otherwise promised to the petitioners’ Unit. (iii) That the State Bank of India failed to provide additional funds to the petitioners’ Unit with a view to ensure its proper working, which had suffered on account of the blockade of the funds from various sources as also the stoppage of work in its Unit at Samba. It is stated the bank was under an obligation to check the sickness of the unit and help it tide through the difficult period. 5. It is in the backdrop of the aforementioned facts that the petitioners have prayed for the following reliefs in the present petition: Mandamus, commanding the respondents to; OWP No. 755/2013 Page 3 of 6 (a) ensure smooth and timely inflow of funds and release of subsidy and other tax benefits/exemptions as assured at the time of setting up of the unit; (b) payment of adequate compensation to the petitioners for failure to ensure supply of power/electricity; (c) re-scheduling of the loan to the petitioners’ unit by taking the issue with the concerned bank including the Reserve Bank of India. 6. During the pendency of the writ petition, CMP No. 1/2017 was filed, seeking amendment of the writ petition. In this amendment, the amounts claimed by the petitioners by way of compensation have been quantified. Not only this, a direction has been sought against the Union of India and its officers including one Smt. Ranjana Narang- respondent No. 6 and Sh. B.P. Singh-respondent No. 7 to jointly and severally pay compensation of Rs. 44,45,13,064.39/- along with interest to the petitioners. Incidentally, Smt. Ranajana Narang is an Income Tax Officer and Sh. B.P. Singh is the Commissioner of Income Tax (Appeals), who appear to have dealt with the income tax returns filed by the petitioners at various stages. 7. The case set up against the income tax officers is that something, which was legitimately permissible under the Income Tax Act was denied by the said two officers in the course of assessment proceedings, which was rectified at subsequent stages in the mechanism provided under the Income Tax Act, which contributed towards making the petitioners’ Unit sick. Detailed claims have been preferred under various heads on account of subsidies and exemptions under the Industrial Policy on the ground of promissory estoppel. OWP No. 755/2013 Page 4 of 6 8. Additionally, it was stated that one self-occupied dwelling house could not have been attached and was exempted in terms of Section 60(1) CCC read with Section 60(1) (A) of the Code of Civil Procedure. 9. In the response filed by the Union of India, it is stated that protection under Section 60(1) (CCC) of the Code of Civil Procedure is not available to a residential house, which is mortgaged. It is also stated that the procedure initiated by the Bank in terms of the provisions of the SARFAESI Act as well as other statutory provisions under the Recovery of Debts Bankruptcy Act cannot be stalled on the basis of the grounds set up in the writ petition. 10. Heard learned counsel for the parties. 11. Admittedly, the petitioners’ Unit appears to have secured a huge amount of loan from the State Bank of India for setting up/running its industrial unit and admittedly, the loan so advanced remains yet to be paid. The Bank is entitled to resort to the provisions of the SARFAESI Act as also the other statutory provisions, which enable it to recover the amount by taking over such assets as are entitled to be taken over in view of the provisions of the aforementioned statutes. 12. Even when a number of grounds have been set up in the petition, however, learned counsel for the petitioners, during the course of arguments, did not question the power of the bank to resort to the recovery proceedings under the SARFAESI Act or other statutory enactments. The argument was limited to the effect that since the compensation and the subsidies, which the State is under an OWP No. 755/2013 Page 5 of 6 obligation to pay to the petitioners’-Unit was much higher than the loan amount, the bank should proceed to take up the matter with the State Govt. as also the Central Govt. to recover the said amount without in the least touching any of the assets of the petitioners’ unit or its partners or guarantors. In my opinion, this argument cannot survive. There is no privity of contract between the State Bank of India and the State/Central Govt. If the power to proceed in terms of the SARFAESI Act or any other statutory enactments is conceded to the State Bank of India, then it cannot be prevented from resorting to any such remedy. It is settled law that no direction can be issued against statutes. 13. While the petitioners-Unit may have a grievance against the respondents in not providing the power and other facilities to run the unit to its full capacity, the remedy to seek such compensation would not be before this forum. 14. Compensation being sought from Income Tax Officer and Commissioner of Income Tax, Appeals is also misconceived inasmuch as the said officers were only discharging their statutory obligations. 15. Claim of the petitioners against the State Govt./Central Government with regard to payment of subsidies, incentives would however, survive for which it would be open to the petitioners to approach the official respondents with detailed claims, which would be considered on its own merits within a period of six months from the date such a claim is made. However, the writ petition with regard to the other reliefs is without any merit and is, accordingly, rejected. OWP No. 755/2013 Page 6 of 6 16. Writ petition No. 755/2013 is accordingly disposed of along with connected applications. OWP No. 1727/2016 No arguments were advanced by the learned counsel for the petitioners in regard to any of the issues raised in this petition. Hence, the same is also dismissed along with connected application(s). (Dhiraj Singh Thakur) Judge. Jammu: 27.02.2019 (Naresh) NARESH KUMAR 2019.02.28 13:25 I attest to the accuracy and integrity of this document "